Opportunity Cost along the Production Possibility Frontier
One of the key concepts in economics is the opportunity cost, which refers to the value of the next best alternative foregone when a choice is made. Along the production possibility frontier (PPF), opportunity cost increases due to the principle of increasing opportunity cost.

Principle of Increasing Opportunity Cost
- The principle of increasing opportunity cost states that as more resources are allocated to the production of a particular good, the opportunity cost of producing that good increases.
- This is because resources are not equally efficient in the production of all goods and services. As resources are shifted from producing one good to another, the opportunity cost rises because the resources are less suited for the new production.

Example
- Consider a simplified economy that can produce only two goods, guns and butter. As the economy moves along the PPF and produces more guns, resources that are better suited for producing butter are being used for gun production.
- Initially, the economy may be producing more butter and less guns, where the opportunity cost of producing guns is low. However, as more guns are produced, the opportunity cost of producing guns increases as resources specialized in butter production are diverted to gun production.

Conclusion
- Along the PPF, the opportunity cost increases as resources are reallocated from one good to another due to the principle of increasing opportunity cost. This concept highlights the trade-offs that societies face when making production choices.